Minority and Women-owned Firms get Boost from Pilot Program

A pilot project of the Massachusetts Association of Community Development Corporations and the Massachusetts Minority Contractors Association has brought nearly $39 million in economic opportunity to minority-owned and women-owned business enterprises in its first year.

The Boston Pilot Program was launched last year, said MACDC President Joe Kriesberg, with the aim of increasing the utilization of MBE/WBEs by community development corporations for their real estate construction projects. The program established goals that at least 30 percent of work will be awarded to MBEs and at least 10 percent to WBEs.

The program includes 11 projects by six Boston CDCs. Six of the projects are under construction now and the other five are in the pre-development phase. The program will be ongoing until all of the projects are finished, Kriesberg said. The targeted work includes both “hard costs” such as direct construction costs and “soft costs” such as services provided by architects, attorneys and consultants.

So far, of the $95 million in project contracts, 36 percent has gone to MBEs and 9 percent to WBEs. In total, nearly $39 million — 41 percent of all contract dollars — has gone to either MBEs or WBEs. (The total percent is not an exact sum of the separate figures, as the program does not double-count minority women businesses.)

Kriesberg indicated the program is continuing to strive toward meeting the 10 percent WBE participation goal and also increasing the soft-cost dollars going to MBE/WBEs. So far, soft costs represent only a small portion of the contracts.

Under the program, John B. Cruz Construction, a Boston minority-owned company, was awarded the $7.8 million Walnut Avenue Apartments project developed by the Jamaica Plain Neighborhood Development Corporation. In a statement, company president John Cruz called the award “a substantial opportunity for a minority-owned general contracting firm” and stated his commitment to ensure that 50 percent of the subcontracts are awarded to minority businesses and that over 50 percent of the labor force will be minority workers.

The MACDC/MMCA program helps fill a gap left by the Boston Resident Jobs Policy, which sets targets for local, minority and female workers on city-funded construction projects, but does not address the utilization of minority-owned enterprises.

Hiring local minority general contractors is bound to have a multiplier effect on the local economy, said Greg Janey, a MMCA vice president and co-chair of the Boston Pilot Program.

“When minority general contractors are awarded contracts, they’re going to have a larger number of minority subcontractors,” he said. “This initiative came about because MMCA thought the CDCs should maintain their mission of taking care of the contractors within their radiuses — take care of your house before you go abroad, if you will.”

Highlights of the joint pilot program include “life cycle involvement,” a requirement that the goals are met during pre-construction, construction, and post-construction phases; and a requirement that a minority general contractor is to be invited to all bids during the procurement process, Janey said. MMCA and MACDC have also been working with CDCs and city and state agencies on ways to ensure prompt payment, a key issue for small contractors.

Besides JPNDC, the participating CDCs are Codman Square Neighborhood Development Corporation, Dorchester Bay Economic Development Corporation, Madison Park Development Corporation, Nuestra Comunidad Development Corporation and Urban Edge.